Barbie maker Mattel says it will raise prices for some U.S. products in response to Donald Trump’s tariffs, but automaker Ford said the US president’s action will cost around $1.5 billion (£1.1 billion) this year.
The US represents about half of Mattel’s global toy sales, and the company imports about 20% of the products sold from China. Mattel said it would reduce China’s imports to the US to less than 15% by 2026.
“Given the volatile macroeconomic environment and the evolution of the US tariff environment, it is difficult to predict consumer spending and US sales of Mattel for the rest of the year and the holiday season,” Toymaker said it had withdrawn its annual financial targets.
The company said it is “pricing action” in its U.S. business “when necessary” in response to tariffs.
Meanwhile, US automotive company Ford has withdrawn its financial guidance and said it expects tariffs to add $2.5 billion to total costs this year. This is primarily due to increased import costs from Mexico and Canada. However, it plans to cut around $1 billion in these costs through various measures.
The automaker said tariffs have caused “industry-wide supply chain disruption” and created uncertainty. “These can have a significant impact on financial results and, given the potential scope of results, we could challenge guidance throughout the year this year.”
Ford is not planning to raise the price of the vehicle until he sees how rivals react to Trump’s tariffs, its CEO, Jim Farley said.
Last week, General Motors, another “Big 3” Detroit car maker with Ford and Stellantis, cut profit guidance for next year, warning that Trump’s tariffs could cost as much as $5 billion in 2025.
The US and China have raised tariffs on each other’s goods to more than 100% since Trump took office earlier this year.
Mattel CEO Ynon Kreiz told Reuters: “There’s no doubt that tariffs are causing disruption in the industry. Many companies have stopped production and shipment to the US as a result of tariffs from China. They support the Toy Association’s defense of zero toy charges.”
The company had made changes to its supply chain to reduce US China-backed products. For example, Kreiz said they were increasing production of UNO card games in India to serve the US market and increase the flow from China to international customers.
Apart from China, Mattel imports products such as Barbie Dolls and Hot Wheels toys from Indonesia, Malaysia and Thailand. These also suffered mutual tariffs from the Trump administration in early April before being suspended for 90 days.
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Trump has tried to downplay the fear that the threat of a lack of supply from his tariffs could lead to a decline in toys for our children.
He claimed last weekend that “young women” would “not need 37 dolls” and that he was “very happy with 2, 3, 4, 5.”
Mattel expects an incremental cost of approximately $270 million from this year’s tariffs starting in July quarter, but mitigation measures are expected to completely offset those costs.
“Toymers are straight up in the crosshairs of Trump’s tariff war,” said Zak Stambor, senior analyst at Emarketer.
Mattel targeted annual net sales growth of 2% to 3% per year.
Reuters contributed to this report